As a gesture of appreciation towards employees, salary review serves as a driver of motivation and commitment. This decision, made by the management, involves increasing salaries within a company. It is a strategic element for retaining talent. However, mastering this process is crucial to avoid counterproductive effects, including the complexity of payroll management. Here’s a guide on how to conduct a successful salary reevaluation campaign.

Salary Review: Establishing Clear and Fair Evaluation Criteria

A salary increase policy is subject to the principle of organizational justice. This is why its implementation requires the upfront formalization of evaluation criteria, such as employee performance, seniority, completed training, etc. These conditions serve as a benchmark to ensure the relevance and transparency of salary enhancement. The primary goal is to remunerate employees fairly.

Setting the Budget for Salary Review

Before launching a salary review campaign, it is essential to establish the budget allocated for increases and the allocations for each department. Several factors should be considered in determining this amount:

  • Financial capacity of the company
  • Inflation rate
  • Salary costs
  • Market salaries
  • Reward system (individual performance, level of experience, seniority, etc.)

Careful consideration of these factors will help in setting an appropriate and fair budget for the salary revision process.

Involving Stakeholders in the Salary Review Process

While the strategic direction of salary policy falls under the purview of the CEO, the salary review process involves multiple stakeholders:

  • The finance department defines the budget based on the financial capabilities of the company.
  • The human resources department provides insights into market conditions and the financial reality of employees.
  • Supervisors submit proposals for salary increases based on the actual circumstances of their teams in the field.
  • The executive committee reviews each situation and makes final decisions.

Managing Expectations: Anticipating and Addressing Disappointments in the Salary Review Process

While a comprehensive salary review is often anticipated at the end of the year, it can be a costly option for companies. Many opt to provide individual salary increase allocations based on each employee’s situation. In such cases, it is crucial to proactively address potential disappointments by compensating for a lack of salary increase with other incentives such as improved health benefits, gift vouchers, profit-sharing bonuses, etc.

Optimizing Payroll Management: Leveraging an Outsourced Payroll Service Provider

Managing payroll is a significant challenge in a salary increase campaign, involving the adjustment of various HR data such as base salary, social contributions, and bonuses. Opting for outsourced payroll management in Antananarivo provides the benefit of maintaining unified employee records, facilitating information processing.

As a professional payroll outsourcing service in Madagascar, MDG Services is a valuable partner to support you in your salary review process. We handle:

  • Collection and input of modifiable data (new salary, bonus amounts, fringe benefits, etc.).
  • Preparation of payroll statements.
  • Social and tax declarations.

MDG Services also offers administrative HR assistance to help with daily personnel management tasks (registration with social organizations, hiring and termination of employees, obtaining work visas, etc.).